While it is obvious to most observers that culture plays an important role in shaping norms and habits, and thus would have impact on poverty–discussions of culture have not been within the domain of polite conversation for the last several decades within many academic circles. As Patricia Cohen writes:

The reticence was a legacy of the ugly battles that erupted after Daniel Patrick Moynihan, then an assistant labor secretary in the Johnson administration, introduced the idea of a “culture of poverty” to the public in a startling 1965 report. Although Moynihan didn’t coin the phrase (that distinction belongs to the anthropologist Oscar Lewis), his description of the urban black family as caught in an inescapable “tangle of pathology” of unmarried mothers and welfare dependency was seen as attributing self-perpetuating moral deficiencies to black people, as if blaming them for their own misfortune.

Moynihan’s analysis never lost its appeal to conservative thinkers, whose arguments ultimately succeeded when President Bill Clinton signed a bill in 1996 “ending welfare as we know it.” But in the overwhelmingly liberal ranks of academic sociology and anthropology the word “culture” became a live grenade, and the idea that attitudes and behavior patterns kept people poor was shunned…

Thankfully, this is changing. According to Ms. Cohen, culture is increasingly an acceptable topic in domestic research as well.

“We’ve finally reached the stage where people aren’t afraid of being politically incorrect,” said Douglas S. Massey, a sociologist at Princeton who has argued that Moynihan was unfairly maligned.

The old debate has shaped the new. Last month Princeton and the Brookings Institution released a collection of papers on unmarried parents, a subject, it noted, that became off-limits after the Moynihan report. At the recent annual meeting of the American Sociological Association, attendees discussed the resurgence of scholarship on culture. And in Washington last spring, social scientists participated in a Congressional briefing on culture and poverty linked to a special issue of The Annals, the journal of the American Academy of Political and Social Science.

“Culture is back on the poverty research agenda,” the introduction declares, acknowledging that it should never have been removed.

By the way, for an interesting read on the topic of culture and poverty in the developing world look at the 2001 book, Culture Matters, edited by Lawrence Harrison and Samuel Huntington.

I have read “Culture Matters” and highly recommend it. Culture never left the table in developmental economics. It was barred only within the US.

North and his New Institutional school of econ brought us back to the importance of institutions in development (helping us to catch up to Adam Smith), but his explanation of how institutions develop was weak. Culture reinforces it. Culture determines institutions which determine economic development.

But what determines culture? This is still a forbidden subject, but the answer is religion. And that’s why you have to look for the beginnings of capitalism in Christianity.